Everyone prospers under health law

Just 12 months after the Patient Protection and Affordable Care Act became law, the American people are enjoying new protections, greater freedoms and lower costs.

Children are now protected from being turned away by insurers because of a pre-existing condition. Seniors enrolled in Medicare now have the freedom to get preventive care — such as mammograms and colonoscopies — for free. A Patient’s Bill of Rights is freeing families from some of the worst abuses of insurance companies, including canceling coverage when you get sick because of a paperwork error.

Early signs show that, after years of decline, the number of small businesses offering coverage to employees is increasing.

Perhaps less widely recognized, but no less significant, has been the way the law is demanding transparency and accountability from the insurance industry to bring down premiums.

For too long, it’s been common for people receive a letter from an insurer announcing a premium increase of 20 percent to 25 percent, with little explanation and no recourse. That’s already changing.

During the past year, our department has provided states with almost $250 million in funding to strengthen their ability to review, revise or reject unreasonable rate hikes. New proposed rules would force many insurers to justify big increases and post explanations on the Web. States from California to Connecticut have already shown that vigorous oversight can be effective in stopping unjustified premium increases.

And for the first time, insurers are being held accountable for the way they spend consumer premiums. New rules require insurers to pay out 80 percent to 85 percent of premium dollars on health care and quality improvement efforts — rather than marketing and executive bonuses. Those who don’t meet this standard will have two choices: reduce rates or send customers rebates.

By holding insurance companies accountable, we are making sure families and small-business owners get the best value for their premium dollars.

We also know that individuals and small businesses have often had to pay significantly more for health insurance than big businesses, which can use their size to negotiate lower premiums. But in 2014, individuals and small businesses will be able to pool their purchasing power through new state-based health insurance exchanges to bring down their rates. Millions of people will be eligible for tax credits, based on need, to help them afford health coverage.

Today, Americans also have a new Web-based tool that allows them to comparison shop for the best insurance options available in their zip codes. Go to www.healthcare.gov to check it out.

These efforts are helping to make the health care marketplace more competitive. When consumers have the information they need to easily compare plans, insurance companies will not longer be able to hide behind fine printr. If they want to compete, they’ll have to provide quality coverage at an affordable price.

When you add together all these improvements under the Affordable Care Act, projections based on data from the nonpartisan Congressional Budget Office show that a family of four, making $55,000, could save more than $6,000 a year on health insurance in 2014. For a family making $33,000, those savings will be nearly $10,000 annually. For many American families, this means that health insurance will be within reach for the first time.

Ultimately, we know that the biggest factor driving up premiums is the soaring cost of care. So, as part of the health care law, we have invested in preventive care, and innovative programs aimed at slowing that growth of premiums. By testing and implementing new ideas to coordinate care, improve patient safety, and reduce waste, fraud and abuse, the law will create additional savings for decades to come. Analysts predict that by 2019, these efforts could save an additional $2,000 for a family policy for employer-based coverage.

President Barack Obama has made clear that his administration is willing to work with anyone to improve the law and fix what needs fixing. That’s why, after hearing from governors, providers and patients, the president recently announced his support for legislation that allows states to pursue innovative alternatives to the law, provided they can achieve the same results as the Affordable Care Act — including relief from skyrocketing costs.

What we can’t afford to do is take away these benefits, cancel these rights, and return to the days when insurance companies got between you and your doctor. If we want to relieve the burden of rising health care costs on families, businesses, and government, we need to move forward not back.

Kathleen Sebelius is secretary of the Department of Health and Human Services.